The government has to choose winners and losers among the banks, Levitt says. “Nothing less will work.”

That’s not the favored policy of the Obama administration, but “it’s being pushed toward that,” he says. “The whole idea of forcing banks to lend is a populist notion. To whom are they going to lend? I don’t think there’s demand from borrowers out there.”

The government can’t force banks to lend, Levitt says. “At most, the government can jawbone.”

Levitt sees the regulatory structure changing radically.

“There is no longer a brokerage industry for the SEC to regulate,” he says. “The SEC and the CFTC (Commodity Futures Trading Commission) are likely to be merged.”

Levitt fears over-regulation. “You can’t carry this too far,” he says. “Businesses already are choked by lack of funds. You can’t choke them more with regulations.”

Stock price declines make nationalization more likely, note others.

While bank nationalization is a last resort, “that last resort doesn't seem so far removed at this point, particularly because of valuations,” James Smith, chief executive of Webster Financial Corp. in Waterbury, Conn., told The Wall Street Journal.

lol! The banks have already been nationalized. For all intents and purposes, the american banking structure is already bankrupt. The only reason jpmorgan bank of america and other banks are still open is because we are literally propping them up with taxpayer money!